Writing a Business Plan Series, Week 3: The Business, Part 2

Bluebell Woods, a photo by TheGirlsNY on Flickr.
I know this isn't a picture of water, but it is a sea of periwinkle from one of my favorite places: bbg.org.

Going back to Garrett Sutton's Writing Winning Business Plans, he states that while location is not "a critical factor for all businesses, it should be discussed in all business plans... Begin with the basics - [address, zoning, why this site was chosen, what facilities are at this location] - then expand on each." Then add the site's history, a physical description, and contact numbers." He wants us to ask ourselves many tough questions about business climate, so it's much more than place of business. "Allow for [either expansion or downsizing], and address all the factors that accompany them: personnel, buildings, land, parking, traffic, zoning, lease agreements, and the like."

Management and personnel fall under his chapter on logistics. According to his The Rich Dad Tip, this is "one of the most... read sections of [a] business plan... Write it according to a "'People Magazine/gossip style nature' because people want to read about what others are doing." Team is a crucial part to a B-I Triangle business' foundation. Sutton has an in-depth way of sorting out personnel needs with index cards. With one skill/task per card, include time estimates and the cyclical nature, then rate myself on how well I perform it. Balance this with how much time will be spent on the business, and then prioritize by importance or cost. Complete this and I'll begin to have a "good idea of my personnel needs and start-up costs as well as for the future." 

WIBO'S coverage of bookkeeping and accounting (Records) influenced me so much, I went out and bought some ledgers and Angie Mohr's Bookkeeping Boot Camp. I know some of my weaknesses lie in this area. Sutton states to "add record keeping and/or accounting systems and why they were chosen. I need to "understand [my] system, show that [I] can handle the load" and show how they will help "improve [my] business".

Insurance and security are a huge deal for businesses and is part of my and my customers' protection. Sutton wants his readers to consider their goals to:  

1. keep liabilities to a minimum 
2. prove to potential investors that I recognize the realities of product and personal liability in my industry

The latter shows investors I'm not a "high risk" and ensures they "see a return on their investment. It also shows I'm "ready, willing and able to reduce the risks of my business". The insurance list is very long. I need to know the standards for real estate so I don't get too much coverage and "plan for my security needs now". I'll need to sit down with an insurance agent soon to make sure I have everything my business needs in these two areas. 

I so like Sutton's Litigation section, that I'll quote a most important paragraph:

"But litigation and lawyers are now a permanent part of the business landscape. Some entrepreneurs, companies, and even real estate investors focus on their legal strategy as much as they do on marketing. Sophisticated investors understand this and will not be deterred by the presence of litigation that occurs in the ordinary course of business. That said, investors could have second thoughts about investing if the result of the litigation could snuff out the company's survivability, such as an environmental or hazardous waste claim, or the inability to use a key proprietary process. But also know that failing to disclose such a material matter as litigation can give those same investors a claim against you personally for misrepresentation and fraud. When in doubt, disclose."

Writing my business plan is exciting and there are many more questions I must ask myself. It's a first draft, so I'm going to have to push myself to completion, but so far, so good. Until next week...